By: Jared Evan
Experts in the airline industry believe coronavirus will have a devastating effect on New York airports and the industry in general.
The Guardian reported that:” US airlines are seeking a $50bn bailout as the industry staggers in the wake of the Covid-19 pandemic.
Airlines for America, which represents major carriers including American Airlines, Delta and United, is calling for immediate relief in the form of direct aid and loan guarantees.”
“This is a today problem, not a tomorrow problem. It requires urgent action,” said Airlines for America president Nicholas Calio.
Crain’s explained: Last Wednesday night President Donald Trump announced a travel ban on all passengers flying from the European Union—a decision made without consulting either the national airline industry or European leaders. The new ban comes on the heels of his earlier flight ban of passengers from China. e heels of his earlier flight ban of passengers from China. While made with public health concerns in mind, these unilateral decisions by the president could end up destroying the business model of multiple airlines who use New York City as a hub for both international and domestic travel.
At this point any actions such as those by Trump are totally understandable in this emergency, however from a business perspective this is devastating. NY airports are a frequent hub for people from the middle of the country flying to Europe.
Airline expert, Bob Mann, an aviation analyst and consultant with 40 years of experience, explained to Crain’s: “The anxieties associated with flying, being in that tube for hours on end, will itself deter people from traveling that way,” said Barnett, who noted that United Airlines announced its net revenue—new bookings minus the cancellations—was 70% below what it was at this time last year. “It’s a historically bad time for airlines, without a doubt,” Mann told Crain’s.
New York’s three airports—LaGuardia, JFK, and Newark Liberty—all receive a higher percentage of airplanes carrying cargo than other parts of the country. Crain’s Brian Pascus pointed out if people are afraid to fly commercially, cargo rates will have to drastically increase.
The effects of Coronavirus on the airline industry are already being seen throughout the industry. Dallas News reported that: “Southwest Airlines plans to reduce flights by 20% between April and June and freeze hiring as the COVID-19 coronavirus forces an “unprecedented” number of cancellations.
“As the impact of the COVID-19 pandemic grows, and based on current booking and cancellation trends, we expect revenue trends for the remainder of March and second quarter 2020 to deteriorate further,” the company said in a regulatory filing Monday.
If Trump approved of the bail out it would be the largest industry bailout since the government interventions after the 2008 financial crisis and the airlines’ first broad bailout since September 11, 2001’s terrorist attacks.
